The U.S. Treasury Department on March 11 sanctioned a Russia-based bank for attempting to circumvent restrictions previously placed against Venezuela’s state-owned oil company, PDVSA.

The bank “Evrofinance Mosnarbank,” which is jointly owned by Russian and Venezuelan state-owned companies, was sanctioned for its support of PDVSA. Evrofinance’s net assets grew more than 50 percent during 2018 as the treasury continued to escalate the use of sanctions.

PDVSA is an entity that has long been a “vehicle for corruption, embezzlement, and money laundering by Maduro and his cronies,” the Treasury Department noted.

“The illegitimate Maduro regime has profited off of the suffering of the Venezuelan people,” said Treasury Secretary Steven T. Mnuchin in a statement.

Venezuela’s President Nicolás Maduro speaks during a rally at the Miraflores Presidential Palace in Caracas, Venezuela, on March 9, 2019. (YURI CORTEZ/AFP/Getty Images)

“This action demonstrates that the United States will take action against foreign financial institutions that sustain the illegitimate Maduro regime and contribute to the economic collapse and humanitarian crisis plaguing the people of Venezuela.”

A ‘Lifeline’ For Maduro

The Treasury Department noted that Nicolás Maduro feels increasingly isolated and desperate for “lifelines from Russia” as the United States and more than 50 countries now recognize Venezuela’s interim president, Juan Guaidó, as the legitimate leader of the country.

Russia, in particular, is known for being a longtime ally of Venezuela, dating back to Maduro’s predecessor, Hugo Chavez. Chavez bought a 49 percent stake in Evrofinance through the Venezuelan National Development Fund in 2011. At that time, Russia’s Gazprombank and Russia’s state bank, VTB Bank—the country’s second-largest bank—each owned a 25 percent stake in Evrofinance.

Evrofinance was created as a “bi-national bank to fund joint Russia–Venezuela oil and infrastructure projects,” according to the Treasury Department.

Venezuela interim President Juan Guaido (L), Colombian President Ivan Duque (C), and U.S. Vice President Mike Pence pose for a photo after a meeting of the Lima Group concerning Venezuela at the Foreign Ministry in Bogota, Colombia, on Feb. 25, 2019. (AP/Martin Mejia)

While major U.S.- and European-based financial institutions cut off ties with Maduro’s regime, the assets of Evrofinance continued to rise. Venezuela suffers from an economic and humanitarian collapse spurred by Maduro’s socialist policies and corrupt leadership, which has led to around 90 percent of the population living below the poverty line. At the same time, less than half of families in the country are able to meet their basic food needs.

Evrofinance was also the primary international financial institution willing to finance the Petro—a failed Venezuelan cryptocurrency launched in 2018. Early investors in the Petro were invited to buy the cryptocurrency via wiring funds to a government account at Evrofinance. According to the Treasury Department, the bank’s involvement in the Petro revealed that Maduro hoped the cryptocurrency would help Venezuela to avoid financial sanctions from the Trump administration.

The United States on March 1 imposed visa restrictions on individual officials aligned with illegitimate dictator Maduro, along with their families. At the same time, six Venezuelan government officials associated with the obstruction of humanitarian aid deliveries were specifically named and sanctioned.

The restrictions came a day after Russia and China—staunch supporters of the embattled dictator who have invested billions into his socialist regime—vetoed a U.S. resolution that asked the United Nations Security Council to push for democratic elections and access to humanitarian aid in Venezuela.

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